How do consumers benefit from increased competition?
A general increase in competition should benefit all users including consumers by lowering price and improving service performance as well as promoting more innovation and wider choice. In markets where payments are relatively slow and expensive improvements will be greater than in markets where they are already very fast and efficient. In the latter markets there will be much less scope for improvement. The Payments Services Directive should increase competition in three main ways: • first by creating an integrated market, existing providers will be able to compete more easily across borders; • second by facilitating the market entry of new competitors, e.g. ‘pure’ payment institutions or hybrid payment institutions such as telecoms, supermarkets; • third, by more transparent information (e.g. on the cost of a payment account) and the elimination of hidden costs (e.g. value dating) customers will be able to compare prices more easily and shop around.
